The University of St Andrews Superannuation & Life Assurance Pension Scheme has named Aon Hewitt as its fiduciary manager.
Aon Hewitt now has complete operational control over the £90m open defined benefit pension scheme. This involves making investment decisions as well as selecting, appointing and monitoring asset managers.
The scheme said concerns over volatility in the markets were behind the decision to delegate management of its investments to a third party.
The trustees have worked with Aon Hewitt on investment strategy for several years. So they turned to the consultancy to discuss ways to protect the portfolio from market turbulence.
“We decided to delegate the day-to-day management of all our scheme’s assets to enable Aon to get their very best ideas and expertise into our portfolio without the need for the trustees to select, review and monitor multiple managers,” explained University of St Andrews Superannuation & Life Assurance Pension Scheme chair of trustees Ken Dalton.
“This had the added benefit of delivering significant annual cost savings through the more efficient portfolio proposed,” he added.
“Most importantly, we had the comfort of knowing that the portfolio will evolve alongside our needs and provide early response as new or better investment opportunities emerge without the loss of governance by the trustees.”
Aon Hewitt senior partner and head of European distribution, Sion Cole (pictured), added that the agreement has helped reduce volatility while minimising manager concentration risk.
“Our delegated offering only invests in our highest conviction buy rated managers. By evolving the portfolio to reflect our latest views on markets, asset classes, strategies and managers, we can effectively future proof our clients’ investments.
“We do all of this on our clients’ behalf, so they get a market leading solution without the governance burden,” Cole said.
